Potash production is steadily on the rise, with global potash output trending higher year-over year, due to growing demand. It is estimated that world wide consumption for the crop fertilizer will reach 46.2 million tonnes in 2022.
That’s welcome news for the sector — many potash operations have closed in recent years, and some are waiting on the sidelines for better days. These include BHP Billiton’s (ASX:BHP,NYSE:BHP,LSE:BLT) Jansen asset in Canada, which is on hold until it is able to pass “strict investment hurdles.”
According to the US Geological Survey (USGS), other potash and production operations set to come online between 2018 and 2021 include new in Belarus, China, Russia and Spain. These new projects could an additional 15 million MT of output by 2021.
Additional projects in Argentina, Australia, Canada, UK and parts of Africa have been delayed until 2023 due to low potash prices and financing issues.
The USGS estimates that of potash and related will from 42.2 million MT in 2018 to 46.2 million MT by 2021, and suggests that Asia and South America will be the largest potash consumers.
With that in mind, it’s worth looking at the top countries for potash production in 2017. Here’s an overview of the 10 countries that produced the most of the fertilizer, as per US Geological Survey data.
Mine production: 12 million MT
Canada is the producer of potash, with production growing by 2-million MT annually since 2016. The country’s fell slightly in 2018, from 12,200 million MT in 2017, to 12,000 million MT.
Nutrien (TSX:NTR,NYSE:NTR), the largest potash company is based in the Canadian prairie province of Saskatchewan. The company which was established in early 2018 is the result of a merger between two crop companies, Potash Corporation of Saskatchewan and Agrium. The partnership has “create a global agricultural giant” valued at US$36 billion.
Mine production: 7.5 million MT
in Russia was up slightly year-over-year. In 2018 output hit 7.5 million MT compared to 7.3 million MT in 2016. Uralkali (MCX:URKA) is Russia’s premiere potash company, as well as a world’s leading potash producer accounting for roughly 20 percent of global supply. The company has five mines and seven ore treatment and processing mills. The company recently announced it was investing 5.4 billion to expand its capacity to process raw materials by 50 percent, with a target of reaching 19 million tonnes per year.
Mine production: 7.1 million MT
Potash production in Belarus remained the same year-over-year. Output in the eastern European country has increased since 2016 when Potash production totals came in at 6.4 million MT.
Belarusian Potash Company is the country’s largest industry operator, with some even going as far as calling it a cartel. Since Uralkali pulled out of Belarusian in 2013, its former partner, state-owned Belaruskali, has had a rocky road to recovery. Belaruskali has six mines and four processing factories. Its reserves are estimated to be 247.5 million tons.
Despite an accident at one of its mines in 2017 involving a rock slide and two missing workers, Belaruskali’s production has not been affected.
Mine production: 5.5 million MT
Looking over to China, potash production has remained relatively the same from 2016 to 2018, at 5.5 million MT. Potash is extremely vital in China — the country is the largest consumer of the fertilizer, accounting for approximately 20 percent of world consumption. Chinese demand bounced up in 2017, and the country’s agreement with potash giant Uralkali established a much higher benchmark price for the year.
Mine production: 2.9 million MT
In Germany, potash production stayed nearly the same from 2016 to 2018, going from 2.7 million MT to 2.9 million MT.
K+S (ETR:SDF) is one of Germany’s leading potash and has a number of projects, operating six in three districts of Germany. The company began production at its new Bethune mine in Saskatchewan in 2017. K+S states that it is ramping up to have an annual capacity of 2.86 million tonnes of potash from the Bethune plant alone.
Mine production: 2.0 million MT
Potash production in Israel also remained unchanged throughout 2018 and 2018, producing 2.0 million MT each year. The country is sixth in terms of potash production, and it also hosts the world’s sixth-largest potash-producing company: Israel Chemicals (TLV:ICL). The company has about 6 million MT of annual capacity, and produces roughly a third of the world’s bromine, which is often produced from the same salt water and brine deposits that produce potash.
Mine production: 1.4 million MT
While potash production in Jordan increased marginally from 2017 to 2018, the country fell short of Israel and got bumped down to seventh place. Arab Potash Company, located in Jordan, is the eighth-largest producer of potash by volume, and is the sole producer of potash in the Arab region. It has helped make Jordan a key potash supplier for India and Asia.
Mine production: 1.2 million MT
Chile recorded production of 1.2 million MT of potash in 2017, the same as the year before. One of the largest producers of potash in the country is Sociedad Quimica y Minera (NYSE:SQM), which is also a leading producer of lithium. South America in general is a large consumer of potash.
Mine production: 560,000 MT
Spain remained in ninth place for potash production in 2018 with yearly production dropping year-over-year. in 2017, the country produced 610,000 MT of potash, down from the previous year’s total of 670,000 MT. Spain has reserves of 44 million MT of potash. Geoalcali has a few potash projects in Spain, including: Izaga, Muga and Sierra Del Perdon.
10. United States
Mine production: 500,000 MT
The US bumped the UK from the 10th spot on the list in 2017 and continued to hold onto the spot in 2018. According to the USGS, total potash production for the US was worth US$400 million in 2017, which represents a 25-percent decrease from the previous year. Production came mostly from Southeastern New Mexico and Utah.
The country put out 500,000 MT of potash for the year, a relatively steep drop from 2014, when it put out 850,000 MT of the mineral. The center of US potash production is New Mexico, where four mines are operated by two companies; Utah also has three potash operations. US potash goes largely to the fertilizer industry, which in turn uses the fertilizer to increase crop production and yields, as well as improve soil health and add in crop water retention. Any leftover potash output is used in the chemical and industrial sectors.
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Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.